Rescue hope for struggling Game Group

SHARES in troubled video games retailer Game Group nearly doubled yesterday on hopes of a rescue deal.

Shares in video games retailer Game Group nearly doubled yesterday on hopes of a rescue deal.

The new owner of electrical goods retailer Comet emerged as a possible saviour of the business which this week warned that its survival was at risk.

Turnaround specialist OpCapita, which bought struggling Comet for a token £2 in December, is understood to have offered to buy out Game Group’s lenders and repay all its suppliers for an estimated £100million.

There were also reports that Asda’s owner Wal-Mart could be interested in making an offer.

Shares in Game Group, which have collapsed from 300p four years ago, rose 82 per cent, up 1p to 2.1p, valuing the company at £7.6million.

The board of Game confirm that a third party has shown interest in providing additional funding for the company

Game Statement

Sentiment was buoyed after it emerged US fund Blue shore Global Equity had built up an 8 per cent stake.

Earlier this week the company, which runs 1,270 stores and employs 10,000 staff, warned shareholders could be wiped out if it failed to find a buyer or reach a rescue deal with its banks.

In a statement the retailer last night said: “The board of Game confirm that a third party has shown interest in providing additional funding for the company.

“The third party is seeking a dialogue with the group’s current lenders, however there is no certainty to the outcome. At the same time, the board remains in its own discussions with its current lenders as it continues to conduct a review of its business and assets.

“It is uncertain whether any of the solutions currently being explored by the board will be successful or will result in any value being attributed to the shares of the company.”

The retailer, which owns the Game as well as the Gamestation chains, has been hit by falling sales and profits and a number of games makers have refused to supply it, leaving the company unable to offer some of the big new releases.

In the past two weeks it has been forced to tell customers to shop elsewhere for such new releases as Electronic Arts’ Mass Effect 3 and Capcom’s Street Fighter X Tekken games.